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    Following is a question by the Hon Frederick Fung and a written reply by the Secretary for Financial Services and the Treasury, Mr Frederick Ma, in the Legislative Council today (April 27):

Question :

    Will the Government inform this Council of the following in respect of the past five years:

(a)  the respective annual numbers of work contracts outsourced by the Housing Department, the Department of Health, the Food and Environmental Hygiene Department and the Leisure and Cultural Services Department; the total amount of contract value and the total number of workers employed by the contractors concerned, together with a breakdown of such figures by the type of outsourced works, as well as the list of approved contractors used by each department in vetting and approving tenders as well as the list of non-compliant contractors; and

(b)  the respective annual savings achieved by each of the aforesaid departments as a result of outsourcing and how the savings have been calculated?

Reply:

Madam President,

    Based on the information provided by the Efficiency Unit, the reply is set out below.

(a)  Details of outsourcing contracts awarded by the Housing Department, the Department of Health, the Food and Environmental Hygiene Department and the Leisure and Cultural Services Department in the last five years are set out in the table at Appendix I.  However in some cases, it has not been possible to provide detailed information in respect of the number of staff employed on government contracts since the staff employed by the contractors may be deployed to both government and private sector contracts.  Besides, as departments follow outsourcing best practices in managing a contract, the focus is primarily on achieving the quality standards specified in the contract and value for money of the required result, rather than the number of staff a contractor may choose to deploy for the contract.  Lists of approved contractors used by each department are at Appendix II.  As for non-compliant contractors, only the Housing Department has maintained such information which is for internal reference only.

(b)  It should be noted that the primary objective of outsourcing is to ensure value for money and quality service delivery, not cost cutting.  The departments cannot provide detailed information on savings achieved by all contracts particularly for outsourcing contracts that have been in place for many years on which such information is not available.  Information that is available is summarized at Appendix III.

Ends/Wednesday, April 27, 2005

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